Public Provident Fund (PPF): Overview

If you haven't already started on a long-term savings strategy,
you could begin with a Public Provident Fund (PPF)
subscription . A government-guaranteed fixed
income security, this is very apt as a long-term savings instrument.
Yearly subscriptions can be as low as Rs. 500 to as high as Rs. 1,00,000.

It counts being among the most secure investments you can have in
this country. The interest earned on the PPF subscription is
compounded; that means you not only earn interest in the money you
put in, but you earn interest on the interest earned too. All the
balance that accumulates over time is exempt from wealth tax.

A flip side, its an extremely illiquid investment
instrument. Its lengthy lock-in period works out to 16 years since
the last contribution is made in the 16th financial year. In all, the
PPF is a very good savings instrument, and you should consider
investing in it.